The Law of ADR: Legislation, Cases and the Courts

• Author: Andrew J. Pirie
• Profession: Faculty of Law. University of Victoria
• Pages: 307-342

307

CHAPTER 8

THE LAW OF ADR:

LEGISLATION, CASES

AND THE COURTS

A. INTRODUCTION

Few people would be surprised to find there exists a large body of law

on subjects such as contracts, torts, property, business associations, the

constitution, the family, crime and trusts, to name a few. One source of

this law comes from the decisions of judges regarding disputes that

have gone to the courts for adjudication. The disputes may have been

about such issues as whether there was a need for independent legal

advice before the elderly person signed the bank guarantee, whether a

psychiatrist owed a duty of care to warn the target of his patient’s rage,

whether the chief executives are personally liable for a crime commit-

ted by their company or whether sexual orientation is relevant in

deciding what is in the best interests of the children. Court decisions

on these and other disputes, along with their interpretation and appli-

cation to future cases that come to court, make up the powerful and

evolving legal standards or common law that lawyers employ to advise

clients what can, cannot or might be done in specific situations.

The law also includes legislation enacted by federal, state, territo-

rial or provincial governments. This legislation may, for example,

establish guidelines for support payments in divorce proceedings,

require sustainable practices to be followed when harvesting timber,

make certain conduct criminal, fix income tax rates, provide protection

against unfair trade practices or regulate the price of oil and gas. Legis-

lation can actually prevent some disputes from arising by making it

308

ALTERNATIVE DISPUTE RESOLUTION

clear what behaviours or which standards are to be followed. Legisla-

tion also can be a way of resolving an ongoing dispute by setting out a

legislated solution.

Although this law may be expected, the law of ADR may be a sur-

prise. After all, alternative dispute resolution emerged as a movement

that stood in stark contrast to court adjudication. ADR proponents saw

a need to avoid the undue cost and delay of litigation. They extolled

the virtues of non-adversarial approaches to dispute resolution. Nego-

tiation, mediation and other forms of consensual decision-making were

a first focus of ADR and informal justice and informalism were defining

characteristics in ADR’s early days. ADR and formal law more resem-

bled antonyms than anything else in contemporary dispute resolution

conversations.

A number of factors have combined to change this picture. As dis-

cussed in chapter 1, the meaning of ADR has come to include how liti-

gation is managed with a focus on the appropriate method for resolving

any given dispute. The space that initially existed between ADR and

the court is no longer as yawning. There are increasing examples of

ADR initiatives, such as mandatory or court-connected mediation,

being implemented within the very formal justice system that ADR first

stood in opposition to. An ADR movement that had attracted hostility

and criticism from the legal profession is now being heartily embraced

by most lawyers. ADR practices and procedures are presented as an

integral part of what it is that good lawyers do. Along with this legal

acceptance, there have been increasing examples of ADR being for-

mally institutionalized by governments and organizations into existing

societal systems and structures. Not surprisingly, disputes about ADR

use have come with these developments. Some disputes have been

principled and about important policy issues such as qualifications.

But other disputes have been more pragmatic and pressing, requiring a

more immediate reply.

•Should a government endorse ADR in this legislative session? What

should the endorsement say?

•Should ADR be spelled out for pupil and school disputes as well as

for funeral home operators and their clientele?

• Can a party be exempted from attending mandatory mediation?

• Are communications made in mediation privileged?

• What is the scope of judicially assisted dispute resolution?

• When should a judge order a mini-trial to be held?

• Can a mediator be negligent?

It perhaps should not be a surprise that the law of ADR is also developing.

The Law of ADR: Legislation, Cases and the Courts

309

The theory and practice of ADR now are informed by the law of

ADR. Understanding the law of alternative dispute resolution is impor-

tant because this law — whether it is judge-made law or legislation —

can directly affect and even dictate what should or must be done in

best ADR practices. In a related way, the law of ADR and how this law

develops have enormous potential to shape the ideological meaning of

ADR by creating these legal frameworks for what is normal, natural,

and essential in disputing practices and by having the courts resolve

the disputes that arise about the meaning of ADR and how it should be

practised. A critical eye on the law of ADR provides opportunities to see

what components of disputing the legal frameworks and judges favour

and what parts may be ignored or left behind.

The law of ADR can be conveniently examined by considering

selected ADR legislation, judicial decisions involving ADR and ADR in

the courts.

B. ADR LEGISLATION

As the use of ADR became popular, governments began increasingly to see

opportunities to apply ADR processes to public disputing scenarios. The

business of running democracies was always filled with controversy. Gov-

ernance disputes, whether about the siting of a new waste management

facility, regulating fisheries, taxing decisions, making modern treaties

or international trade agreements, choosing parks over industrial plants,

criminalizing the right to die, or pepper-spraying protesters tended to be

costly, time-consuming, and often hard to settle. Shielding difficult public

policy decisions and the decision makers by closing Cabinet doors, relying

mostly on a bureaucratic analysis, providing varying degrees of fairness in

administrative hearings, or making and defending town hall–type

announcements was being viewed as unsatisfactory by many people

affected by the issues at hand. More openness and transparency in good

government were being demanded. The emergence of ADR was particu-

larly timely for besieged and cost-conscious governments. ADR develop-

ments in the private sector raised an awareness that better options might

be available to enhance or improve public dispute resolution as well.

Several governmental responses to ADR have been referred to ear-

lier, the most significant of which has been the institutionalization of

ADR in the form of ADR legislation. In the United States, there are over

two thousand federal and state statutes regulating the field. In Canada

and other countries, the number is substantially smaller but growing

steadily. ADR legislation generally takes two shapes.